What questions should I be asking?
Wednesday I will be meeting with my first lead/seller to be shown about 10 different properties. What are some of the more important questions I should be asking? These properties are all highly distress and 50+ years old? What would be your big concerns? Wiring? Foundation? Roof? Etc?
My objective is to find properties for myself, however if it's not something I see working for me wholesaling it would be ideal.
Any "do's" or "don'ts"? Thanks!
You'll definitely want to ask about foundation- if you are getting a loan, lenders will not lend on properties that have foundation problems. If you are buying with all cash, then that's a different story. Also ask about the roof, electrical, and plumbing. These are all big ticket items that cost a lot of $$$ to update and repair. Ideally, you'll want to find something that you can flip that needs only cosmetic work done, nothing major. Also, you'll want to ask if anyone died in the house (you'll need to disclose that when you sell), since that can impact the value significantly.
It might be wise to take a general contractor with you to each property, so they can tell you the estimated rehab costs. Hope this helps :)
First due diligence is - will they make you money-if they are going to be long term holds- I use the 1% rule of purchase+rehab say is 60,000 - I would want at least $600/mo gross.
This way - if you have an idea of what the sales price is and the potential rent- you have a ball park of what you have to pay for rehab. MAKE AN OFFER with a clause that you need your GC to review. LOCK UP the properties before you waist time.
I usually ask a GC to see what it will take to do a rent ready or sales ready-
if it looks like it might be extensive- than I ask one of the city code enforcers to view the property with the comments of the GC. Get another investor to walk it too-